Doug Casey is an American free-market market economist, financial author and entrepreneur. He has been writing a monthly investment newsletter, the International Speculator since 1979 and I always find his ideas quite refreshing.

I the paragraphs below, he is interviewed by Louis James, editor of the International Speculator.

L: So, Doug, it’s well known that in addition to investing in resource stocks, especially gold juniors, you also have a passion for playing the real estate market. What can you tell us about real estate in today’s world?

Doug: Real estate has been very, very good to me. The reason that’s true is that I buy only things that I like myself. I don’t try to second-guess what other people may want. If you do that, you’re guaranteed to wind up with mediocre stuff that nobody really wants. I have an inclination

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Zillow Real Estate (www.zillow.com) reports that Americans with negative equity in their single-family homes fell to 21% in the third quarter which is 2 percentage points better than the second quarter at 23%. The bad news is that some of that improvement is because more homeowners were forced into foreclosure so the homes were taken out of the negative equity category and landed in the REO (real estate owned) column at the lending institutions.

The federal government’s $8,000 tax incentive program for first time home buyers originally scheduled to end by November 30, 2009 but extended to April 30, 2010, combined with the new $6,500 incentive for current/repeat home owners has had a positive effect on home sales. However some of those homes, 21%, were previous foreclosures.

The overwhelming majority

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Image by SashaW via Flickr               Det amerikanske aksjemarkedet snur opp torsdag etter en liten justering ned de siste dagene. USA-økonomiens viktigste indikator – arbeidsledigheten – fortsetter å stige. I Alabama forberedes det som kan bli historiens største kommunale konkurs.     En annen meget viktig indikatoren er boligmarkedet. Av dagens tall kan nevnes at The Mortgage Bankers Association index of mortgage [...]

This post provides links to a number of thought-provoking articles I have read over the past few days that you may also find interesting.

• Matt Taibbi (Taibblog): An inside look at how Goldman Sachs lobbies the Senate, September 29, 2009.

Samuel Brittan (Financial Times): A cool look at the current deficit hysteria, October 1, 2009. In the early Victorian period the debt ratio was nearly 200 per cent and almost reached that level again in the early 1920s.

• Edmund Conway (Telegraph):  An inconvenient truth: financial crises are inevitable, October 1, 2009. The IMF’s new early warning system to avoid crises such as the credit crunch is doomed to disappoint.

• Edward Harrison (Credit Writedowns): The recession is over but the depression has just begun, October 1, 2009. This post discusses why we are in a depression, not

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The dark cloud of commercial real estate loan defaults is inching closer, threatening to shutter more banks, even as the U.S. Federal Reserve declares the recession to be over.

Commercial property values in the U.S. have plummeted 36% since peaking in 2007, and the commercial real estate market is unlikely to recover before 2012, according to the quarterly PricewaterhouseCoopers Korpacz Real Estate Investor Survey, released yesterday (Tuesday).

Office rents in New York and San Francisco may drop 20% through next year, the survey found.

“The biggest problem is that commercial real estate lags what happens in the economy,” Susan Smith, who is the director of PricewaterhouseCoopers’ real estate advisory practice and editor-in-chief of the survey, told Bloomberg News. “Companies are looking for ways to cut costs, many are continuing to reduce workers and are continuing to reduce their space needs.”

That means many

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Mortgage delinquencies move higher…Euro pushed higher by European data…Economist predicts Norway will be first to raise…Mexico to leave rates unchanged…And Now… Today’s Pfennig!

Good day… And happy Friday! The data released yesterday morning was a mixed bag, as the leading indicators climbed for a fourth straight month and the Philadelphia fed reported a big jump in their gauge of activity, but the initial jobless claims unexpectedly rose. Unemployment in the US will continue to be a drag on the economy, slowing any recovery and possibly pushing the US back into recession (or as some predict a depression). Today we will get some news on the housing market, and while the media will pump up the fact that month on month sales continue to rise, another report released yesterday showed mortgage delinquencies hit a record high in July. The proportion of homeowners delinquent on their mortgage or in foreclosure rose to its

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No currency movement to speak of… Buffett calls out the deficits… PIMCO does too! SNB selling francs to stem gains… nd Now… Today’s Pfennig!

Good day… And a Wonderful Wednesday to you! Another day with the medicine in my knee and it feels better yet today… I did have to ice it last night though, I guess I’m still not out of the woods here, but I can see the exit!

There was very little in the way of movement in the currencies yesterday. The euro moved to 1.4150, but was brought back down

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Housing Market Showing Signs of Stability? Puh-lease!

The mainstream press would have us to believe a real estate market rebound is imminent. They keep glomming onto any data that shows the slightest sign of stability.

For instance, Bloomberg jumped all over the July 1 report from the National Association of Realtors that showed pending sales for previously owned homes rose for the fourth consecutive month. Other outlets had a field day with the news out of the Mortgage Bankers Association that refinancings hit a three-month high in early July. And ditto for the news that foreclosures dropped 11% in the second quarter.

But these “signs of stabilization” are bogus. Or to beg, borrow and steal from value-investing legend, Whitney Tilson, they are the “mother of all head fakes.”

Fact is, these short-term improvements were fabricated. They materialized because of temporary factors like the $8,000 first time homebuyer tax credit (set to expire November 30),

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Is it time to buy a house? Depends…

If you need a place to live and want to own a house, why not? Prices in some areas are fairly reasonable. But if you’re speculating, our guess is that you’ll get a better deal if you wait.

Why? For the many reasons we have given you in these Daily Reckonings. House prices may be firming in some areas – that’s what the Case-Shiller numbers seem to show. But nationwide, they are probably headed down for quite a while longer.

Herewith, four reasons why:

First, as you know, this is a depression. It will probably be long. And deep. You wouldn’t know it from looking at the stock market or reading the news. The Dow went up another 114 points yesterday. Oil rose to $71. And the dollar – anticipating inflation – fell to $1.44 per euro.

But that’s what bounces are supposed to look like.

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It would seem that the US housing market - arguably the Achilles heel of the global financial morass - is finally looking up.

Following the announcement on Monday that the inventory of unsold new houses in the US had dropped from 10.2 months’ supply to a three-year low of 8.8 months’ supply, the S&P/Case-Shiller Home Price Indices yesterday showed an increase on a monthly basis in May for the first time since July 2006. Thirteen of the 20 metro areas reported positive returns, with the 20-City Composite rising by 0.5%. Although not yet in positive territory, the seasonally adjusted monthly figures nevertheless represent a significant improvement, with the 20-City down by only 0.2%.

Source: Asha Bangalore, Northern Trust - Daily Global Commentary, July 28, 2009.

The 20-City Index declined by 17.1%

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